Betsey Stevenson is a Great Economist

She wrote this convincing essay on happiness and parenting. Parents seem to be less happy but we shouldn’t read too much into that. She brings together all kinds of economic theory and data and along the way she cites a paper I like very much by Luis Rayo and Gary Becker:

Nobel Prize–winning economist Gary Becker, writing with Luis Rayo, has argued this contrary position. In their view, while “happiness and life satisfaction may be related to utility, they are no more measures of utility than are other dimensions of well-being, such as health or consumption of material goods.”[5] Or having kids. Children may make you less happy, but still raise your utility. Devout neoclassical reasoning leads Becker and Rayo to infer from the fact that we are having kids that they raise your utility (or at least they raise the utility of those who make this choice).

Rayo and Becker argued that happiness should be thought of as the carrot that gets us to make good decisions. But happiness is a scarce resource. There’s a limit to how happy you can be. So it has to be used in the most economical way. In their theory the most economical way to use happiness is to give an immediate, and completely transitory boost of happiness to reward good outcomes. You have sex, you get rewarded. It results in conception, that’s another reward. But then you are back to the baseline so as to maximize the range available for further rewards (and penalties) motivating behavior going forward. Bygones are bygones.

With that theory it makes no sense to look at a cross section of the population, compare how happy are people who did X relative to people who didn’t do X, and conclude on the basis of that whether its good to do X.

And by the way, if there is anything we can expect evolutionary incentives to have a good handle on, its whether or not to have kids. That’s the whole ballgame. If happiness is there to motivate us to succeed evolutionarily then you better have a good argument why Nature got it wrong. One place to look might be on the quantity/quality tradeoff. Perhaps the relative price of quality versus quantity has declined in modern times and Nature’s mechanism is tuned to an obsolete tradeoff. If so, then people feel a motivation to have more kids than they should. The prescription then would be to resist the temptation you feel to have another kid and instead invest more in the ones you have. Unless you want to be happy.

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8 comments

Interesting article (esp. since one of my areas of interest is emotions). Thanks very much for the reference.

Re: “If happiness is there to motivate us to succeed evolutionarily then you better have a good argument why Nature got it wrong.”

From what I’ve read, it seems as thought it doesn’t actually take Nature getting it wrong to say that having children may be unrelated (or even negatively related) to the momentary emotion of happiness. From the research, there’s an awful lot more that motivates people beyond happiness (e.g., avoiding pain – or, in the case of children, the desire to continue your own life, which is what evolution is actually about). Further, happiness isn’t the same as, say, serenity or security or a host of other emotions and motivations that would be increased by having children (even life satisfaction seems to be separate from happiness).

BTW, to go back to a post you had a long time ago – I’m betting that most people are like me: we comment on posts where we think there may be unmentioned mediators or moderators, but not so much on posts that we agree with. I’m saying that to also say that I very much enjoy your posts, even when I’m not commenting. :)

Confess I haven’t read the Stevenson article yet, but I think there is a pretty good correlation-due-to-joint-cause-not-causation story for children and (un)happiness. The gene cluster for wanting children, and wanting everything to go right with your children, though obviously an evolutionary plus, might also easily make you less happy (the kids are never perfect and they’re a lot of work.) People in whom these genes are weaker will be happier.

The point is, this correlation has no bearing on what decision someone *ought* to make with their genes fixed, even to maximize happiness. Unless the happiness-children connection comes with better controls than I think it does?

[…] a twenty-something reader will cleverly point out that I just need to count kids as a good which yields utility, or perhaps we need to add a state variable to the utility function as in rational addiction […]

[…] to task on some of his claims. It’s worth reading the full essay. Jeff Ely at Cheap Talk says you should take note of her views on the distinction between happiness and utility. Instead, I want to highlight an insight that […]

[…] to task on some of his claims. It’s worth reading the full essay. Jeff Ely at Cheap Talk says you should take note of her views on the distinction between happiness and utility. Instead, I want to highlight an insight that […]